STOCK DIFFERENCE IN AUDIT DEFECT

[SK Krishna]

Hello sirs/madams,

Why should the purchase turnover in stock value not be estimated based on GSTR - 2A figures and it has to be reconciled based on books of accounts.??

Why AS-2 has to be considered by the department authorities??

Pls post your views .Thank you🙏🏻

[Amit Agrawal]

Section 35 of the CGST Act, 2017 requires assessee to keep & maintain a true and correct account of many thing including ''stock of goods".

Rule 56 of the CGST Rules, 2017 further elborates about these requirements including with regards to various stocks.

So, GSTR-2A got limited role to play. Its your books of accounts and other records which Dept. will primarily check to arrive at their conclusions. And keeping and maintaining those accounts / records is your responsibility.

From your query, I have not understood why are issues faced by you and what is your legal arguments therefor. Can you please elaborate?

These are ex facie views of mine and the same should not be construed as professional advice / suggestion.

[Ganeshan Kalyani]

Sir, your books of accounts is the record / evidence of transaction that takes place in your regular course of business. It is basis for GST payment, filing of return, assessment etc.

GSTR 2A is a report to facilitate recipient of goods or services to make them aware that their suppliers are doing their GST compliance timely. This report is not final as some supplier may mention GSTIN of some other recipient.

[Vijay kumar]

It seems department has asked for details of stock maintained by you under AS-2 whereas you wish to value the purchase stock based on GSTR-2A. In this regard, your attention is invited to Rule 56(18) of GSTR'17 which reads as follows:

Every registered person shall, on demand, produce the books of accounts which he is required to maintain under any law for the time being in force.

If you are required to maintain books as per AS-2 under any law for the time being in force, you will have to produce the same to the Dept. Otherwise, normal books of a/c will do

AI Summary

Books of account requirement: production of maintained stock records governs GST audit, not GSTR 2A reports. The primary basis for valuing purchase turnover and stock in a GST audit is the taxpayer's maintained books of account, which must be produced on demand; GSTR 2A is a facilitative report with limited reliability and cannot substitute for reconciliation with statutory accounts. If stock valuation or maintenance is governed by an applicable accounting standard, those records must be produced to the department when required.